Eqstra offer ‘unfair, unreasonable’ – Protech
JSE-listed Protech Khuthele on Tuesday advised its shareholders to reject the R146-million offer by construction and mining equipment group Eqstra to acquire the 67.2% interest in Protech it did not already own.
Eqstra has offered Protech shareholders 60c a share.
Protech said in a statement on Tuesday that PricewaterhouseCoopers Corporate Finance, acting as an independent expert, had concluded the market value, on a controlling basis, of a Protech share, was between 79c and 88c a share.
Protech stated in its latest half-year results presentation that the net asset value of its shares were 93.8c apiece.
As a result, Protech believed the Eqstra offer was “unfair and unreasonable” to shareholders.
“Taking into account the opinion of the independent expert, we are of the opinion that the Eqstra offer significantly undervalues the company and is unfair and, accordingly, we strongly recommend that Protech shareholders reject the Eqstra offer,” the company said.
Eqstra CEO Walter Hill, in February, said the offer, which would close on July 26, would provide Protech shareholders with an attractive cash price to realise fair value at a healthy premium.
“Our offer positions Protech appropriately to benefit from the synergies and economies of scale that can be achieved by sharing resources between Eqstra and Protech,” he indicated.
However, Protech Khuthele CEO Anthony Page said such synergies would still have to be discussed, “Protech and Eqstra’s business models are very different; Eqstra is an asset-based leasing business and Protech is a construction business. I do not yet know how these will tie together.”
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